Interim Report and Accounts - Aryzta€¦ · namic pricing, last seen in 2008. Current trends suggest double digit price inflation may be necessary to recover costs. Volatility in

2011Interim Report and Accounts

Table of Contents

Interim Report 2011

Page

02 Interim Financial and Business Review

12 Bridge to Group Income Statement

13 Group Condensed Interim Financial Statements

1

AryztA AG Interim Report 2011

1 Key performance highlights

Group– Group revenue increased by 36% to €1.89bn.– Group EBITA increased by 52% to €173.1m.– Group EBITA margin increased by 90bps to 9.1%.– Underlying fully diluted EPS increased by 34% to 140.3 cent.

Food Group– Revenue increase of 60% to €1.28bn. - Food Europe increased by 10%. - Food North America increased by 140%. - Food Rest of World increased by 591%.– Net debt reduced by 4.6% to €1.06bn.– Net debt: EBITDA ratio of 2.46x.– Food Group gross term debt weighted average maturity of circa 6.7 years.– Weighted average interest cost of Food Group financing facilities of circa 4.14%.

Origin– Origin Enterprises underlying fully diluted EPS growth of 32% to 11.45 cent.– Origin Enterprises now strategically positioned as a focused agri-business.

Commenting on the results, ARYZTA AG Chief Executive Officer Owen Killian said:

“While the major feature of these results is the enormous contribution from our recently acquired businesses, we are most encouraged by the improvement in underlying revenue growth as consumers adjust to improving economic circumstances in most markets.

We have initiated business combination projects in Europe and North America which, as we roll out the ARYZTA Technology Initiative (ATI), will create the opportunity to unlock the potential within our enlarged customer base.

The speed and severity of food raw material price increases was unexpected and is again a major focus in the business. In such an inflationary environment, bakery plays an important role in a food menu or basket and provides an innovative value proposition for consumers”.

Interim Report 2011

Interim Financial and Business Review

2

AryztA AG Interim Report 2011 Interim Financial and Business Review

Interim Financial and Business Review (continued)

2 ARYZTA AG – Income Statement 6 month period ended 31 January 2011

in Euro ’000 January 2011 January 2010 % Change

Group revenue 1,894,272 1,394,053 35.9%

EBITA 173,118 114,013 51.8%

EBITA margin 9.1% 8.2% –

Associates and JVs, net 10,729 13,635 –

EBITA incl. associates and JVs 183,847 127,648 44.0%

Finance cost, net (36,713) (23,723) –

Hybrid instrument accrued dividend (3,911) – –

Pre-tax profits 143,223 103,925 –

Income tax (20,684) (16,965) –

Non-controlling interests (6,263) (4,430) –

Underlying fully diluted net profit 116,276 82,530 40.9%

Underlying fully diluted EPS (cent) 140.3c1 104.5c1 34.3%

1 January 2011 underlying fully diluted EPS is calculated using the weighted average number of shares in issue of 82,856,277 (H1 2010: 78,946,101), following placement of 3,864,335 registered shares in June 2010 in relation to the acquisition of Fresh Start Bakeries.

2 See glossary in section 20 for definitions of financial terms and references used in the Interim Financial and Business Review.

3 ARYZTA AG – Underlying revenue growth 6 month period ended 31 January 2011

in Euro million Food EuropeFood North

AmericaFood Rest

of WorldTotal

Food Group Origin1 Total Group

Group revenue 585.3 610.5 87.4 1,283.2 611.1 1,894.3

Underlying growth (0.9)% 2.1% 18.4% 0.4% 7.4% 3.3%

Acquisitions and disposals 7.3% 128.2% 549.5% 54.3% (7.4)% 28.1%

Currency 3.3% 9.4% 23.1% 5.5% 3.0% 4.5%

Revenue Growth 9.7% 139.7% 591.0% 60.2% 3.0% 35.9%

1 Origin revenue is presented after deducting intra group sales between Origin and Food Group.

4 ARYZTA AG – Segmental EBITA 6 month period ended 31 January 2011


Food Group

Food Europe 66,004 60,736 8.7%

Food North America 76,953 35,271 118.2%

Food Rest of World 12,520 2,073 504.0%

Total Food Group 155,477 98,080 58.5%

Origin 17,641 15,933 10.7%

Total Group EBITA 173,118 114,013 51.8%

Associates & JVs, net

Food JVs 4,328 8,468 (48.9)%

Origin associates & JV 6,401 5,167 23.9%

Total associates & JVs, net 10,729 13,635 (21.3)%

Total EBITA incl. associates and JVs 183,847 127,648 44.0%

3


5 Food Group – Income Statement 6 month period ended 31 January 2011


Group revenue 1,283,194 800,921 60.2%

EBITA 155,477 98,080 58.5%

EBITA margin 12.1% 12.2 % –

JVs, net 4,328 8,468 –

EBITA incl. JVs 159,805 106,548 50.0%

Finance costs, net (30,590) (15,961) –

Hybrid instrument accrued dividend (3,911) – –

Pre-tax profits 125,304 90,587 –

Income tax (18,580) (15,576) –

Non-controlling interests (1,716) (1,257) –

Underlying net profit 105,008 73,754 42.3%

6 Food Group businessARYZTA’s Food Group business is primarily focused on speciality baking, a niche seg-ment of the overall bakery market. Speciality bakery consists of freshly prepared offer-ings giving the best value, variety, taste and convenience to consumers at the point of sale. ARYZTA’s customer base is a balanced mix of convenience and independent retail, large retail, quick service restaurants and other foodservice categories.

Total revenue growth in the Food Group business is underpinned by the recent strategic acquisitions. Underlying revenue growth during the period is returning, supported by evidence of a consumer recovery across most markets. However, the overall operating environment remains challenging with primary food inflation accelerating during the pe-riod. Dynamic pricing is being implemented to recover the cost from rising input prices.

Business combination initiatives are currently underway in the Food Europe and Food North America businesses, which combined with the ARYZTA Technology initiative (ATI), will create the opportunity to unlock the potential within the Group's enlarged customer base.

7 Food EuropeFood Europe has leading market positions in the European speciality bakery market. It has a diversified customer base including convenience retail, gas stations, multiple retail, restaurants, catering and hotels, leisure and quick service restaurants.

Food Europe revenue grew by 9.7% to €585.3m, with acquisition contribution of 7.3% and underlying revenue decline of 0.9%. Food Europe’s EBITA grew 8.7% to €66.0m.

Although revenue continued to decline in Ireland and UK over the period, there is evidence of market stabilisation. Challenges still remain in these markets with ongoing support to customers in repositioning their value proposition. In continental Europe, there is a return to growth, particularly in the independent segment (bakeries, boulangeries and independent restaurants).

Interim Financial and Business Review (continued)4


8 Food North AmericaFood North America is a leading player in the US bakery market. It has a diversified cus-tomer base including multiple retail, restaurants, catering and hotels, leisure, hospitals, military, fundraising and quick service restaurants.

Food North America revenues grew by 140% to €610.5m, with acquisition contribution of 128% and underlying revenue growth of 2.1%. EBITA grew by 118% to €76.9m.

Growth during the period has been most evident in the retail and quick service restaurant segments, with continued focus on product and value added innovation. Customer centric business combination initiatives have commenced, which are supported by ATI.

9 Food Rest of World ARYZTA has businesses in Brazil, Australia, New Zealand, Malaysia and Japan as well as joint venture production facilities in Chile and Guatemala.

Food Rest of World revenues grew by 591% to €87.4m, with acquisition contribution of 550% and underlying revenue growth of 18.4%. EBITA grew by 504% to €12.5m.

There has been continued focus on the Asian and Latin American quick service restaurant segment, with the construction of a new bakery in Brazil remaining on track. Income development in these markets indicates substantial attractive future opportunities to support ongoing customer developments.

10 Food Group strategic repositioningARYZTA has initiated business combination initiatives across its Food Europe and Food North America businesses. Costs relating to these initiatives, together with the fair value gain on the acquisition of Maidstone Bakeries (Maidstone) in October 2010, have re-sulted in a net benefit of €79.8m over the six month period to the end of January 2011. These break down as follows:

Non-recurring costs for 6 month period ending 31 January 2011

in Euro ’000 Non-Cash Cash Total

Maidstone fair value gain on existing 50% at acquisition 121,391 – 121,391

Business combination costs (18,809) (13,491) (32,300)

Transaction costs (including share purchase tax) – (9,265) (9,265)

Net income statement impact 102,582 (22,756) 79,826

The full financial assessment of these initiatives is still ongoing. Once-off cash costs are targeted to convert 70% to 100% recurring cash EBITA, while non-cash costs should support the optimisation of future capital allocation needs.

In addition substantial progress continues to be made through ATI. SAP has now gone live in both the Otis Spunkmeyer and La Brea Bakery businesses with scoping ongoing across the rest of the North American business platform. The European business plat-form is also currently in the process of scoping the implementation of SAP.



Through these initiatives ARYZTA will be positioned to achieve its medium term financial targets of:– 15%+ return on investment from existing asset base by 2015.– 15%+ return on investment from new investments within 5 years.– Net debt: EBITDA in the range of 2x - 3x.– Effective tax rate target at sub 20%.– Annual maintenance and investment capital expenditure to track annual depreciation.

11 Fair value gain on Maidstone acquisitionA non-cash gain on the previously 50% owned shares in Maidstone is being recorded in the period (under revised IFRS 3 implemented as required for the year ended 31 July 2010). The €121.4m1 fair value non-cash gain is based on multiple of 10.2x EBITDA.

in Canadian Dollar million

Pro forma TTM EBITDA 69.5

EBITDA acquisition multiple 10.2x

Assigned acquisition enterprise value 709.0

in Canadian Dollar million

Carrying value of 50% investment before acquisition 91.8

Net purchase price 445.0

Fair value gain on existing 50% at acquisition 172.2

Assigned acquisition carrying value 709.0

1 CAD 172.2m gain translated at EURCAD rate of 1.42.

12 Primary food inflationThe period has seen a return of food raw material inflation and a consequent return to dy-namic pricing, last seen in 2008. Current trends suggest double digit price inflation may be necessary to recover costs.

Volatility in these input costs is likely to become an ongoing feature of the industry, em-phasising the importance of maintaining secure reliable material sourcing.

Bakery still offers the most compelling food value proposition to consumers in an ongoing inflationary environment. It has an essential role in menu delivery, especially within foodservice. Bakery is the least expensive component of a menu, as one of the lowest unit cost converters from grain to food. It plays an important role in maintaining the development of innovative value propositions to consumers.

13 Financial position ARYZTA’s 71.4% subsidiary and separately listed company, Origin, has separate funding structures, which are financed without recourse to ARYZTA. Origin’s net debt amounted to €98.7m at 31 January 2011. The consolidated net debt of the Group excluding Origin’s non-recourse debt amounted to €1.06bn and relates to the Food segments of the Group. The Food Group net debt: EBITDA ratio is 2.46x (excluding hybrid instrument as debt) and interest cover of 8.15x (excluding hybrid interest). The Food Group gross term debt weighted average maturity is circa 6.7 years. The weighted average interest cost of the



Food Group financing facilities is circa 4.14%. ARYZTA intends to maintain an investment grade position in the range of 2x - 3x net debt to EBITDA.

ARYZTA’s financing facilities and key financial covenants (excluding Origin, which has separate ring-fenced financing without recourse to ARYZTA) are as follows:

Debt Funding Principal1 Maturity

May 2010 – Syndicated Bank Loan CHF 600m Dec 2014

May 2010 – US Private Placement USD 420m / EUR 25m May 2013 – May 2022

Dec 2009 – US Private Placement USD 200m Dec 2021 – Dec 2029

Nov 2009 – Swiss Bond CHF 200m March 2015

Jun 2007 – US Private Placement USD 450m Jun 2014 – Jun 2019

1 Weighted average interest cost of Food Group debt financing facilities (including overdrafts) as at 31 January 2011 of c. 4.14%.

Hybrid Funding

CHF 400m Hybrid instrument with 5% coupon funded in October 2010

After first call date (October 2014) coupon equates to 905bps plus 3 month CHF Libor

Traded on SIX Swiss exchange

Treated as 100% equity for bank covenant purposes

Treated as 25% equity for US PP covenant purposes

Net Debt: EBITDA calculations as at 31 January 2011 Ratio

Net Debt: EBITDA (hybrid as equity) 2.46x

Net Debt: EBITDA (hybrid as debt) 3.17x

Banking covenant calculation (treats hybrid as 100% equity) 2.13x

(Net debt: EBITDA2 covenant 3.5x)

US PP covenant calculation (treats hybrid as 25% equity) 2.99x

(Net debt: EBITDA covenant 4.0x)

2 EBITDA for banking covenant purposes includes impact of non-recurring items.

1 Profile of term debt maturity is set out as at 31 January 2011. Food Group gross term debt at 31 January 2011 is € 1.29bn (excluding overdrafts of € 107.6m). Total Food Group net debt at 31 January 2011 is € 1.064bn.

Interim Financial and Business Review (continued)

Gross Term Debt Maturity Pro�le1

20172018201920202021

20252030

2022

201420132012

20152016

4%9%

37%2%

14%3%3%

2%9%

10%2%

5%

7


Food Group cash generation in Euro ’000 January 2011 January 2010

EBIT 113,000 76,331

Amortisation 42,477 21,749

EBITA 155,477 98,080

Depreciation 41,545 28,044

Reported EBITDA 197,022 126,124

Working capital movement (16,498) (9,968)

Dividends received1 12,967 7,740

Maintenance capital expenditure (22,092) (6,683)

Interest and tax (50,894) (25,363)

Other non-cash income charges 5,165 (475)

Cash flow generated from activities 125,670 91,375

Investment capital expenditure (26,199) (22,591)

Cash flows generated from activities after capital expenditure 99,471 68,784

Underlying net profit 105,008 73,754

1 Includes dividends from Origin of €8,550,000 (H1 2010: nil).

Food Group net debt and investment activityin Euro ’000 Food Group

Food Group opening net debt as at 31 July 2010 (1,115,623)

Cash flows generated from activities 125,670

Hybrid instrument proceeds 285,061

Maidstone Bakeries acquisition (316,563)

Business combination and transaction costs (22,756)

Investment capital expenditure (26,199)

Deferred consideration (12,089)

Dividends paid (2,066)

Foreign exchange movement1 19,606

Amortisation of financing costs and other 985

Food Group closing net debt as at 31 January 2011 (1,063,974)

1 Foreign exchange movement is primarily attributable to the fluctuation in the US Dollar to Euro rate between July 2010 (1.3079) and January 2011 (1.3699).



14 Return on investment

in Euro million

Food Europe

FoodNorth

AmericaFood Rest

of World

Total Food

Group Origin Total

2011

Group share net assets 1,374 1,732 229 3,335 297 3,632

EBITA incl. associates and JVs 140 161 23 325 80 405

ROI 10.1% 9.3% 10.2% 9.7% 27.1% 11.1%

2010

Group share net assets 1,288 676 7 1,971 354 2,325

EBITA incl. associates and JVs 127 85 4 216 73 289

ROI 9.9 % 12.6 % 59.9% 11.0 % 20.6 % 12.4 %

15 Assets, goodwill & intangibles

Group Balance Sheetin Euro ’000 As at January 2011 As at January 2010

Property, plant and equipment 970,640 655,288

Investment properties 20,648 63,083

Goodwill and intangible assets 2,597,937 1,508,187

Associates and joint ventures 159,615 147,270

Working capital, net (53,270) 40,135

Other segmental liabilities (63,690) (89,563)

Segmental net assets 3,631,880 2,324,400

Net debt (1,162,699) (678,348)

Deferred tax, net (297,245) (174,644)

Income tax (52,288) (43,907)

Derivative financial instruments, net (961) (6,710)

Net assets 2,118,687 1,420,791

Food Group Balance Sheetin Euro ’000 As at January 2011 As at January 2010




Joint ventures 5,527 60,118

Investment in Origin 51,045 51,045

Working capital, net (49,450) (18,884)

Other segmental liabilities (43,400) (40,217)

Segmental net assets 3,387,319 2,021,693

Net debt (1,063,974) (487,857)

Deferred tax, net (288,527) (160,838)

Income tax (47,261) (42,466)

Derivative financial instruments, net (296) (4,176)

Net assets 1,987,261 1,326,356



16 OriginOrigin is a leading agri-business group focused on integrated agronomy and agri-inputs, with operations in the UK, Ireland and Poland.

ARYZTA AG is the majority shareholder (71.4 %) in Origin Enterprises plc, which has a listing on the AIM in London and the ESM in Dublin (AIM:OGN, ESM:OIZ). As of 11 March 2011, Origin had a market capitalisation of €532m (133m shares at €4.00), valuing ARYZTA’s holding at circa €380m (95m shares at €4.00).

Since listing, Origin has strategically repositioned its Marine Proteins and Oils, Consumer Food and Feed Ingredients businesses to associates and joint venture. It is now focused on a sustainable agricultural model with a capacity for expansion in a developing fragmented industry.

On 10 March 2011, Origin announced the acquisition of United Agri Products and Rigby Taylor. The acquisitions build upon Origin’s core position in the provision of integrated production systems to primary food producers as well as broadening the Group’s offering into new customer channels. On the same date Origin also announced its interim results. These results reflect positive on-farm momentum and a favourable planning environment for primary food producers.

17 OutlookARYZTA’s revenue growth in the first six months of the financial year 2011 has been un-derpinned by its strategic acquisitions, while also seeing the re-emergence of underlying revenue growth across its markets.

The period has seen a return of food raw material inflation. This is an immediate focus for ARYZTA with current trends suggesting double digit price inflation may be necessary to recover costs. However, bakery still offers the most compelling food value proposition, remaining resilient in an inflationary environment.

ARYZTA continues to focus on unlocking the potential across its enlarged customer base. It is working to achieve this through its combination projects and ongoing investment in ATI underway in both Europe and North America, as well as its development investments in Food Rest of World.

The enlarged business platform is capable of propelling ARYZTA AG to achieve its midterm underlying fully diluted earnings target of 400+ cent per share by 2013 and its longer term target (2015) of 15%+ return on investment from its existing asset base. Current trending indicates full year 2011 earnings guidance of underlying fully diluted 300 cent per share appears reasonable.

18 Forward looking statementThis report contains forward looking statements which reflect management’s current views and estimates. The forward looking statements involve certain risks and uncertain-ties that could cause actual results to differ materially from those contained in the forward looking statements. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments.



19 Principal risks and uncertaintiesThe Board and senior management have invested significant time and resources in identifying specific risks across the Group, and in developing a culture of balanced risk minimisation. The Board considers the risks and uncertainties disclosed on page 42 of the ARYZTA AG 2010 Annual Report and Accounts to continue to reflect the principal risks and uncertainties of the Group over the remaining six months of the financial year.

20 Glossary of financial terms and references'EBITA' – presented before non- recurring items and related deferred tax credits. SAP intangible asset amortisation is treated as depreciation.

'Associates and JVs, net' – presented as profit from associates and JVs, net of taxes and interest.

'EBITDA' – presented as TTM EBITDA to 31 January 2011 including pro forma contri-bution from Fresh Start Bakeries, Great Kitchens, Maidstone Bakeries, dividends from Origin and excludes non-recurring items and related deferred tax credits. (Note, only in the case of EBITDA used for banking covenant calculation purposes, as presented in section 13, does it include non-recurring items and related deferred tax credits).

'Reported EBITDA' – presented as earnings before interest, taxation, depreciation and amortisation reported for the period and before non-recurring items and related deferred tax credits.

'Return on Investment (ROI)' – is calculated as pro forma trailing twelve months EBITA (reflecting the full twelve months impact of Great Kitchens, Fresh Start Bakeries and Maidstone Bakeries acquisitions) over Group share of net assets.

For the purposes of the ROI calculation the pro forma EBITA is presented before impact of non-recurring items. SAP intangible asset amortisation is treated as depreciation.

Group share of net assets is defined as reported net assets excluding bank debt, cash and cash equivalents and tax related balances.

'Non-controlling interests' – always presented after dilutive impact of related subsidiaries' management incentives.

'Hybrid instrument' – presented as Perpetual Callable Subordinated Instrument in interim accounts.

'Interest coverage ratio' – EBITDA divided by TTM net interest charges.

Food Group WACC on a pre-tax basis is currently 7.7 %. Food Group WACC presented on a post-tax basis is currently 6.5%.



in Euro ’000

Food Group 2011

Origin2011

Total Group2011

Total Group2010 % Change

Group revenue 1,283,194 611,0783 1,894,272 1,394,053 35.9%

EBITA 155,477 17,641 173,118 114,013 51.8%

Associates and JVs, net 4,328 6,401 10,729 13,635 –

EBITA incl. associates and JVs 159,805 24,042 183,847 127,648 44.0%

Finance cost, net (30,590) (6,123) (36,713) (23,723) –

Hybrid instrument accrued dividend (3,911) – (3,911) – –

Pre-tax profits 125,304 17,919 143,223 103,925 –

Income tax (18,580) (2,104) (20,684) (16,965) –

Non-controlling interests (1,716) – (6,263) (4,430) –

Underlying fully diluted net profit 105,008 15,815 116,276 82,530 40.9%

Underlying fully diluted EPS (cent) – 11.45c1 140.3c2 104.5c2 34.3%

Underlying net profit reconciliation

in Euro ’000

Food Group 2011

Origin2011

Total Group2011

Total Group2010 % Change

Reported net profit 158,1464 8,916 164,513 64,371 155.6%

Intangible amortisation 42,477 1,660 44,137 23,751 –

Tax on amortisation (11,878) (294) (12,172) (5,341) –

Maidstone Bakeries fair value gain on existing 50% at acquisition (121,391) – (121,391) – –

Hybrid instrument accrued dividend (3,911) – (3,911) – –

Business combination and transaction costs 41,565 327 41,892 – –

Net loss on transfer of Origin Food and Feed Businesses to associates – 5,206 5,206 – –

Non-controlling interests on Origin Food and Feed transactions – – (1,582) – –

Underlying net profit 105,008 15,815 116,692 82,781 41.0%

Dilutive impact of Origin management incentives – – (416) (251) –

Underlying fully diluted net profit 105,008 15,815 116,276 82,530 40.9%

Underlying fully diluted EPS (cent) – 11.45c1 140.3c2 104.5c2 34.3%

1 Actual Origin H1 2011 underlying fully diluted EPS is calculated using the weighted average number of shares in issue of 138,098,000 (H1 2010: 137,626,000).2 January 2011 underlying fully diluted EPS is calculated using the weighted average number of shares in issue of 82,856,277 (H1 2010: 78,946,101), following placement of 3,864,335 registered shares in June 2010 in relation to the acquisition of Fresh Start Bakeries.3 Origin revenue is presented after deducting intra group sales between Origin and Food Group.4 Food Group reported net profit excludes dividend income of €8,550,000 from Origin.

Bridge to Group Income Statementfor the six months ended 31 January 2011

12

AryztA AG Interim Report 2011 Bridge to Group Income Statement

Six months ended 31 January

in Euro ’000 Notes2011

Unaudited2010

Unaudited

Revenue 1,894,272 1,394,053

Cost of sales (1,371,222) (1,005,422)

Gross profit 523,050 388,631

Distribution expenses (252,796) (200,236)

Administration expenses (141,273) (98,133)

Operating profit before gain/loss on transactions, integration, rationalisation and acquisition related costs 128,981 90,262

Net gain on acquisitions and disposals 4 116,185 –

Integration, rationalisation and acquisition related costs 4 (41,892) –

Operating profit 203,274 90,262

Share of profit after tax of associates and joint ventures 10,729 13,635

Profit before financing income and costs 214,003 103,897

Financing income 3,395 3,057

Financing costs (40,108) (26,780)

Profit before tax 177,290 80,174

Income tax (8,512) (11,624)

Profit for the period 168,778 68,550

Attributable as follows:

Equity shareholders of the Company 164,513 64,371

Non-controlling interests 4,265 4,179



Earnings per share for the period Notes2011

Euro cent2010

Euro cent

Basic earnings per share 5 193.94 81.54

Diluted earnings per share 5 193.55 81.22

Group Income Statement for the six months ended 31 January 2011

13

AryztA AG Interim Report 2011 Group Condensed Interim Financial Statements

Group Statement of Comprehensive Incomefor the six months ended 31 January 2011


in Euro ’000

2011Unaudited

2010Unaudited


Other comprehensive income

Foreign exchange translation effects

– Foreign currency net investments (4,618) 28,968

– Foreign currency borrowings 24,373 (17,736)

Cash flow hedges

– Effective portion of changes in fair value of cash flow hedges 4,510 5,464

– Fair value of cash flow hedges transferred to income statement 1,841 511

– Deferred tax effect of cash flow hedges (1,108) (826)

Defined benefit plans

– Actuarial gain / (loss) on Group defined benefit plans arising during the period 795 18

– Deferred tax effect of actuarial gain / (loss) (268) 255

Total other comprehensive income for the period 25,525 16,654

Total comprehensive income for the period 194,303 85,204

Attributable as follows:

Equity shareholders of the Company 188,527 80,613


Total comprehensive income for the period 194,303 85,204

14


in Euro ’000

31 January 2011

Unaudited

31 July2010

Audited

Assets

Non-current assets




Investments in associates and joint ventures 159,615 162,881

Deferred tax assets 72,458 62,290

Total non-current assets 3,821,298 3,455,340

Current assets

Inventory 259,712 212,085

Trade and other receivables 342,817 426,917

Derivative financial instruments 1,761 889

Cash and cash equivalents 381,427 394,587

Total current assets 985,717 1,034,478

Total assets 4,807,015 4,489,818

Group Balance Sheetas at 31 January 2011

15


Group Balance Sheet (continued)as at 31 January 2011

in Euro ’000

31 January 2011

Unaudited

31 July2010

Audited

Equity

Called up share capital 1,061 1,061

Share premium 632,951 632,951

Retained earnings and other reserves 1,424,875 980,190

Total equity attributable to equity shareholders of the company 2,058,887 1,614,202


Total equity 2,118,687 1,673,850

Liabilities

Non-current liabilities

Interest-bearing loans and borrowings 1,494,977 1,575,265

Employee benefits 15,026 15,454

Deferred income from government grants 16,450 18,477

Other payables 6,497 7,107

Deferred tax liabilities 369,703 356,386

Derivative financial instruments 329 804

Deferred consideration 12,497 25,829

Total non-current liabilities 1,915,479 1,999,322

Current liabilities

Interest-bearing loans and borrowings 49,149 46,834

Trade and other payables 655,799 697,674

Corporation tax payable 52,288 53,209

Derivative financial instruments 2,393 6,460

Deferred consideration 13,220 12,469

Total current liabilities 772,849 816,646

Total liabilities 2,688,328 2,815,968

Total equity and liabilities 4,807,015 4,489,818

16


Group Statement of Changes in Equity for the six months ended 31 January 2011

for the six months ended 31 January 2011in Euro ’000

Share capital

Share premium

Treasury shares

Other equity

reserve

Cash flow

hedge reserve

Revalua-tion

reserve

Share- based

payment reserve

Foreign currency transla-

tion reserve

Retained earnings

Total share-

holders equity

Non-controlling

interests Total

At 1 August 2010 1,061 632,951 (30) – (2,603) 35,108 6,188 9,697 931,830 1,614,202 59,648 1,673,850

Profit for the year – – – – – – – – 164,513 164,513 4,265 168,778

Foreign exchange translation effects – – – – – – – 19,380 – 19,380 375 19,755

Cash flow hedges – – – – 4,278 – – – – 4,278 965 5,243

Defined benefit plans – – – – – – – – 356 356 171 527

Total comprehensive income – – – – 4,278 – – 19,380 164,869 188,527 5,776 194,303

Share-based payments – – – – – – 5,776 – – 5,776 131 5,907

Equity dividends – – – – – – – – (30,768) (30,768) – (30,768)

Dividends to non-controlling interests – – – – – – – – – – (5,508) (5,508)

Transfer of revaluation reserve to retained earnings – – – – – (22,262) – – 22,262 – – –

Issue of perpetual callable subordinated instrument (note 7) – – – 285,061 – – – – – 285,061 – 285,061

Dividend on perpetual callable subordinated instrument (note 7) – – – – – – – – (3,911) (3,911) – (3,911)

Purchase of non-controlling interests – – – – – – – – – – (247) (247)

At 31 January 2011 1,061 632,951 (30) 285,061 1,675 12,846 11,964 29,077 1,084,282 2,058,887 59,800 2,118,687

for the six months ended 31 January 2010in Euro ’000

Share capital

Share premium

Treasury shares

Cash flow

hedge reserve

Revalua-tion

reserve

Share- based

payment reserve

Foreign currency transla-

tion reserve

Retained earnings

Total share-

holders equity

Non-controlling

interests Total

At 1 August 2009 1,005 518,006 (30) (6,882) 35,108 4,131 (41,147) 810,165 1,320,356 47,612 1,367,968

Total comprehensive income – – – 4,040 – – 11,816 64,757 80,613 4,591 85,204

Share-based payments – – – – – 739 – – 739 131 870

Equity dividends – – – – – – – (27,861) (27,861) – (27,861)

Dividends to non-controlling interests – – – – – – – – – (5,898) (5,898)

Other – – – – – – – 86 86 422 508

At 31 January 2010 1,005 518,006 (30) (2,842) 35,108 4,870 (29,331) 847,147 1,373,933 46,858 1,420,791

17


Group Cash Flow Statementfor the six months ended 31 January 2011



Unaudited2010

Unaudited

Cash flows from operating activities

Profit for period 168,778 68,550

Income tax 8,512 11,624

Financing income (3,395) (3,057)

Financing costs 40,108 26,780

Share of profit after tax of associates and joint ventures (10,729) (13,635)

Net gain on acquisitions and disposals 4 (116,185) –

Integration, rationalisation and acquisition related costs 19,136 –

Depreciation of property, plant and equipment 43,135 31,254

Amortisation of intangible assets 45,426 23,751

Recognition of deferred income from government grants (339) (949)

Share-based payments 5,907 870

Cash flows from operating activities before changes in working capital 200,354 145,188

Decrease/(increase) in inventory (87,302) (10,881)

Decrease/(increase) in trade and other receivables 48,863 79,758

(Decrease)/increase in trade and other payables (32,889) (122,729)

Cash generated from operating activities 129,026 91,336

Interest paid, net (35,331) (20,811)

Income tax paid (25,319) (13,924)

Net cash flows from operating activities 68,376 56,601

18


Group Cash Flow Statement (continued)for the six months ended 31 January 2011



Unaudited2010

Unaudited

Cash flows from investing activities

Proceeds from sale of property, plant and equipment 3,402 1,249

Purchase of property, plant and equipment

– maintenance capital expenditure (25,616) (9,180)

– investment capital expenditure (22,439) (22,591)

Acquisition of subsidiaries and businesses, net of cash acquired 9 (316,563) –

Sale of subsidiaries and businesses, net of cash surrendered 69,284 –

Purchase of intangible assets (4,598) –

Dividends received from joint ventures 4,417 –

Dividends received from associates 2,048 9,714

Investments in associates and joint ventures (516) (2,455)

Repayment of loan to joint venture 527 –

Deferred consideration paid (12,089) (2,128)

Other (253) 10

Net cash flows from investing activities (302,396) (25,381)

Cash flows from financing activities

Net proceeds from issue of equity instruments 7 285,061 –

(Repayment) /drawdown of loan capital (55,545) (3,016)

Capital element of finance lease liabilities (856) (801)

Dividends paid to non-controlling interests (5,508) (2,742)

Dividends paid to equity shareholders – (27,861)

Net cash flows from financing activities 223,152 (34,420)

Net increase in cash and cash equivalents (10,868) (3,200)

Translation adjustment (3,731) (1,089)

Net cash and cash equivalents at start of period 6 348,349 269,144

Net cash and cash equivalents at end of period 6 333,750 264,855

19


1 Basis of preparationThe Group Condensed Interim Financial Statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting (IAS 34).

These condensed interim financial statements do not include all the information and dis-closures required in the annual financial statements and should be read in conjunction with the Group’s most recent Annual Financial Statements in respect of the year ended 31 July 2010, which have been prepared in accordance with IFRS.

These condensed interim financial statements for the six months ended 31 January 2011 and the comparative figures for the six months ended 31 January 2010 are unaudited and have not been reviewed by the Auditors. The extracts from the Group's Annual Financial Statements for the year ended 31 July 2010 represent an abbreviated version of the Group’s full accounts for that year, on which the Auditors issued an unqualified audit report.

Certain amounts in the 31 January 2010 and 31 July 2010 comparative financial state-ment figures and related notes have been reclassified to conform to the 31 January 2011 presentation. The reclassifications have no effect on total revenues, total expense, profit for the period or total equity as previously reported.

Income tax expense is recognised based upon the best estimate of the average annual income tax rate expected for the full year.

2 Accounting policiesThe condensed consolidated interim financial information has been prepared on the basis of the accounting policies, significant judgements, key assumptions and estimates as set out on pages 56 to 67 of the ARYZTA AG 2010 Annual Report and Accounts.

To enable a full understanding of the Group’s financial performance the Group has expanded its accounting policies that were in place as of 31 July 2010 to present certain items, by virtue of their size or nature, separately within operating profit. Transactions which may give rise to such treatment are principally net gain/loss on acquisitions and disposals, integration, rationalisation and acquisition related costs.

Notes to the Group Condensed Interim Financial Statementsfor the six months ended 31 January 2011

20


Notes to the Group Condensed Interim Financial Statements (continued)for the six months ended 31 January 2011

3 Analysis by business segment

l) Segment revenue and result in Euro ’000

FoodEurope

Food North America

Food Rest of World Origin Total Group






2011 2010 2011 2010 2011 2010 2011 2010 2011 2010

Segment revenue1 585,310 533,624 610,537 254,657 87,347 12,640 611,078 593,132 1,894,272 1,394,053

Operating profit before non- recurring items 45,834 43,439 57,639 30,819 9,527 2,073 15,981 13,931 128,981 90,262

Gain/loss on transactions, integration, rationalisation and acquisition related costs (21,690) – 102,539 – (1,023) – (5,533) – 74,293 –

Operating profit 24,144 43,439 160,178 30,819 8,504 2,073 10,448 13,931 203,274 90,262

Share of profit after tax of associates and joint ventures – – 3,754 8,468 574 – 6,401 5,167 10,729 13,635

Profit before financing costs 24,144 43,439 163,932 39,287 9,078 2,073 16,849 19,098 214,003 103,897

Financing costs (36,713) (23,723)

Profit before tax as reported in Group Income Statement 177,290 80,174

1 There are no significant intercompany revenues between the Group’s food business segments. There were €2,235,000 (2010: €3,661,000) in intra group revenue between the Origin and food business segments of the Group.

21


ll) Segment assetsin Euro ’000

Food Europe

Food North America


as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

Segment assets excluding investments in associates and joint ventures 1,673,208 1,716,751 1,901,035 1,387,060 244,633 243,862 372,878 521,498 4,191,754 3,869,171

Investments in associates and joint ventures 280 293 1,573 69,584 3,674 3,263 154,088 89,741 159,615 162,881

Segment assets 1,673,488 1,717,044 1,902,608 1,456,644 248,307 247,125 526,966 611,239 4,351,369 4,032,052

Reconciliation to total assets as reported in Group balance sheet

Derivative financial instruments 1,761 889

Cash and cash equivalents 381,427 394,587

Deferred tax assets 72,458 62,290

Total assets as reported in Group balance sheet 4,807,015 4,489,818

llI) Segment liabilitiesin Euro ’000

Food Europe

Food North America


as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

as at 31 Jan

2011

as at31 Jul2010

Segment liabilities 299,454 290,001 170,011 175,808 19,692 17,544 230,332 293,657 719,489 777,010

Reconciliation to total liabilities as reported in Group balance sheet

Interest-bearing loans and borrowings 1,544,126 1,622,099

Derivative financial instruments 2,722 7,264

Current and deferred tax liabilities 421,991 409,595

Total liabilities as reported in Group balance sheet 2,688,328 2,815,968


22


4 Cost items within operating profit

Six months ended31 January

Notes2011

in Euro ’000

2010in Euro ’000

Fair value gain on acquisition

Fair value gain on acquisition of 50% share in Maidstone Bakeries 4.1 121,391 –

Net loss on disposal of businesses

Loss on disposal of Origin Food business 4.4 (8,125) –

Gain on disposal of Origin Feed business 4.5 2,919 –

Net gain on acquisitions and disposals 116,185 –

Integration, rationalisation and acquisition related costs

Integration and rationalisation related costs 4.2

– Asset write-downs (13,412) –

– Severance and other staff related costs (7,877) –

– Grant related costs (2,449) –

– Contractual obligations (3,654) –

– Other (5,235) –

Acquisition related costs 4.3 (9,265) –

(41,892) –

Total 74,293 –

4.1 Fair value gain on acquisitionOn 29 October 2010, ARYZTA closed the acquisition of all outstanding shares of the previously 50% owned Maidstone Bakeries joint venture for total deemed consideration of €502,808,000. The consideration was based on a discounted cash flow enterprise value and was in line with market valuation multiples on comparable industry transactions. Maidstone Bakeries is no longer treated as a joint venture for accounting purposes and is now fully consolidated in the Food North America segment. A non-cash gain of €121,391,000 on the previously owned 50% of Maidstone Bakeries has been recorded within operating profit in these financial statements. This is a requirement under IFRS 3 (revised), Business Combinations, implemented by the Group as required for the financial year ended 31 July 2010. See note 9 for further details.

4.2 Integration and rationalisation related costsDuring the period the Group commenced two separate integration and rationalisation programs in each of its Food Europe and Food North America segments. These programs will allow the development of two principal operating platforms in Food Europe and Food North America to optimise the Group’s manufacturing and business support platforms.


23


As a result of decisions made through these projects the Group has incurred and provided for costs to be incurred during the financial period through its income statement as follows:

Asset write-downsAs part of the implementation of the Group’s integration and rationalisation programs the Group has commenced the closure and/or reduction in activity of a number of its operational sites. As part of this process the Group has written down to nil certain manufacturing, distribution and administration assets related to these sites during the period for a total charge of €13,412,000.

Severance and other staff related costsThe Group has incurred and provided for €7,877,000 in severance costs during the period in relation to employees whose service was discontinued following the actual or announced closure and rationalisation of certain Group operational sites.

Grant related costsThe termination of certain activities caused by the Group’s integration and rationalisation programs have resulted in the triggering of certain grant repayment conditions. This has resulted in the reversal of circa €2,449,000 in grants previously amortised through the Group’s income statement.

Contractual obligationsThe operational decisions made through the Group’s integration and rationalisation projects triggered an early termination and/or resulted in certain operational contracts becoming onerous. The Group has incurred total costs during the period to either exit or provide for such contracts of €3,654,000.

Other costsThe Group has identified €5,235,000 in other costs related directly to the implementation of its integration and rationalisation programs during the period. These costs compose principally of integration advisory costs, directly attributable incremental internal staff costs and operational site decommissioning costs.

4.3 Acquisition related costsAcquisition related transaction costs incurred during the period of €9,265,000, relate primarily to the acquisition of the outstanding 50% of Maidstone Bakeries. These costs include share purchase tax, due diligence and other professional service fees. Since the adoption of IFRS 3 (revised), these costs no longer form part of the acquisition consideration and are expensed within operating profit through the income statement.


24


4.4 Loss on disposal of Origin Food business On 10 September 2010, the Group’s 71.4% subsidiary and separately listed company, Origin Enterprises plc (‘Origin’), announced that it had reached an agreement with CapVest Limited (‘CapVest’) to establish Valeo Foods Group Limited (‘Valeo’), to facilitate consolidation of Irish consumer food brands. On 28 November 2010, Origin further announced that Valeo had completed the simultaneous acquisitions of the branded food businesses of Origin and the Irish food company Batchelors. With effect from 26 November 2010, Origin’s 44.1% investment in Valeo has been treated as an associate undertaking and accounted for using the equity method in accordance with IAS 28, Investments in Associates. A loss of €8,125,000 was realised on the disposal of Origin Foods to Valeo. The impact of this loss on ARYZTA’s profit attributable to equity shareholders for the period is €5,803,000 which is after deduction of Origin non-controlling interests. The loss was calculated as follows:

in Euro ’000

Net assets transferred on 26 November 2010:

Property, plant and equipment (30,810)

Goodwill and intangible assets (43,174)

Working capital (12,976)

Provisions for liabilities and charges 3,429

Net assets transferred (83,531)

Consideration:

Fair value of 44.1% equity interest in Valeo Foods 17,108

Investment in associate through vendor loan note 33,540

Net cash consideration 27,518

Total consideration received 78,166

Costs directly related to the transaction (2,760)

Loss on disposal of Origin Food business (8,125)

4.5 Gain on disposal of Origin Feed businessOn 10 November 2010, Origin announced that it had reached agreement with W&R Barnett Limited (‘Barnett’) to establish an all-Ireland grain and feed handling logistics and trading business. The all-Ireland business was formed through the integration of Origin’s R&H Hall (‘Hall’) business in the Republic of Ireland with the business of Origin and Barnett in Northern Ireland. The transaction was completed on 28 January 2011. Under the terms of the transaction, Barnett acquired a 50% interest in Hall, mirroring the economic interests of Origin and Barnett in the Northern Ireland business.


25



Origin now holds a 50% interest in Hall and from 28 January 2011 this 50% holding is treated as an associate undertaking in accordance with IAS 28, Investments in Associates. A gain arose on the transaction as follows:

in Euro ’000

Net assets transferred on 28 January 2011:

Property, plant and equipment (15,412)

Working capital (36,277)

Provisions for liabilities and charges 2,667

Net assets transferred (49,022)

Consideration:


Fair value of existing 50% equity interest in Hall 11,055

Total consideration received 51,941

Gain on disposal of Origin Feed business 2,919

5 Earnings per shareSix months ended

31 January

Basic earnings per share2011

in Euro ’000

2010in Euro ’000

Profit for period attributable to equity shareholders 164,513 64,371

Perpetual callable subordinated instrument accrued dividend (3,911) –

Profit attributable to ordinary equity shareholders 160,602 64,371

Weighted average number of ordinary shares ’000 ’000

Issued ordinary shares at 1 August 82,810 78,946

Effect of shares issued during the period – –

Weighted average number of ordinary shares for the period 82,810 78,946

Basic earnings per share 193.94 cent 81.54 cent

Diluted earnings per share2011

in Euro ’000

2010in Euro ’000

Profit for period attributable to equity shareholders 164,513 64,371

Perpetual callable subordinated instrument accrued dividend (3,911) –

Effect on non-controlling interests share of profits due to dilutive effect of Origin management equity entitlements (234) (251)

Diluted profit for financial period attributable to ordinary equity shareholders 160,368 64,120

Weighted average number of ordinary shares (diluted) ’000 ’000

Weighted average number of ordinary shares used in basic calculation 82,810 78,946

Effect of equity instruments with a dilutive effect 46 –

Weighted average number of ordinary shares (diluted) for the period 82,856 78,946

Diluted earnings per share 193.55 cent 81.22 cent

26



6 Analysis of net debt

in Euro ’000

1 August 2010 Cash flows

Arising on business

combinationNon-cash

movementsTranslation adjustment

31 January 2011

Cash 394,587 (9,844) – – (3,316) 381,427

Overdrafts (46,238) (1,024) – – (415) (47,677)

Cash and cash equivalents 348,349 (10,868) – – (3,731) 333,750

Loans (1,572,275) 55,545 (242) (1,160) 24,373 (1,493,759)

Finance leases (3,586) 856 (21) – 61 (2,690)

Net debt (1,227,512) 45,533 (263) (1,160) 20,703 (1,162,699)

Split of net debtin Euro ’000

1 August 2010 Cash flows

Arising on business

combinationNon-cash

movementsTranslation adjustment

31 January 2011

Food Group net debt (1,115,623) 32,854 (21) (790) 19,606 (1,063,974)

Origin net debt (111,889) 12,679 (242) (370) 1,097 (98,725)

Net debt (1,227,512) 45,533 (263) (1,160) 20,703 (1,162,699)

Finance leases include amounts due within 1 year of €1,472,000 (2010: €596,000).

ARYZTA’s 71.4% subsidiary and separately listed company, Origin, has separate ring-fenced funding structures, which are financed without recourse to ARYZTA.

7 Other equity reserveIn October 2010, the Group raised CHF 400m through the issuance of a Perpetual Callable Subordinated Instrument (‘Hybrid Instrument’), which has been recognised within equity. The proceeds from the issuance were used as principal financing for ARYZTA’s acquisition of the remaining 50% share of the Maidstone Bakeries joint venture held by Tim Hortons Inc. See note 9 for further details.

in Euro ’000 2011

At 1 August 2010 –

Issuance of hybrid instrument, net of transaction costs 285,061

At 31 January 2011 285,061

The Hybrid Instrument offers a coupon of 5%, accruing €3,911,000 to January 2011 (2010: €nil), and is undated with an initial call date by ARYZTA after four years. The balance recognised on issuance is shown net of transaction costs of €7,380,000.

27



8 DividendsThe proposed dividend covering the 12 month period to 31 July 2010 of CHF 0.4802 (2009: CHF 0.5324) per registered share was approved at the annual shareholders’ meeting held on 2 December 2010. The total resulting dividend of CHF 39,765,571 (2009: CHF 42,031,000) was paid in February 2011, to those shareholders holding shares in ARYZTA AG on 26 January 2011.

9 AcquisitionsThe Group completed the acquisition of the outstanding 50% of the Maidstone Bakeries (Maidstone) joint venture on 29 October 2010. As a result and from that date, Maidstone has been accounted for as a subsidiary undertaking and not as a joint venture.

Maidstone operates in Brantford, Ontario from a purpose-built circa 400,000 square-foot bakery. Currently, Maidstone exclusively services the Tim Hortons network under a con-tractual arrangement which extends to 2016 (or 2017 at Tim Hortons’ option) and may be extended beyond this point by mutual agreement.

The goodwill arising on this business combination is attributable to the skills and talent of the Maidstone work force, the synergies expected to be achieved from integrating Maidstone into the Group’s existing businesses and increasing capacity utilisation of the facility.

Details of net assets acquired and goodwill arising from this business combination are set out below:

in Euro ’000

Provisional fair value

Provisional fair value of net assets acquired:

Property, plant and equipment 95,202

Intangible assets 173,943

Inventory 7,925

Trade and other receivables 6,592

Trade and other payables (12,683)

Finance leases (21)

Deferred tax (24,290)

Income tax (2,385)

Net assets acquired 244,283

Goodwill arising on acquisition 258,525

Consideration 502,808

Satisfied by:

Cash consideration 334,719

Cash acquired (18,156)


Investment in joint venture on acquisition date 64,854

Fair value gain on 50% equity interest held prior to acquisition date 121,391

Consideration 502,808

28



Transaction expenses of €6,023,000 related to the Maidstone Bakeries transaction have been charged to integration, rationalisation and acquisition related costs in the Group Income Statement.

ARYZTA's existing 50% equity interest of the joint venture has been re-measured at its fair value, with the resulting gain, over the previous carrying value, of €121,391,000 rec-ognised within the net gain on acquisitions and disposals in the Group Income Statement.

The impact of this business combination during the period on the Income Statement of the Group is set out in the following table:

in Euro ’000

Revenue 43,201

Profit for the period 8,495

If the acquisition had occurred on 1 August 2010, management estimates that con-solidated revenue would have been €1,915,474,000 and consolidated profit for the period would have been €169,667,000. In determining these amounts management has assumed that the fair value adjustments that arose on the date of the acquisition would have been the same if the acquisition had occurred on 1 August 2010.

For the identification and estimation of the fair value of the acquired intangibles of Maidstone, ARYZTA was assisted by an independent appraisal firm. The identified intangibles include the fair value of customer relationships. The excess earnings method (income approach method) was the basis for the fair value of customer relationships.

The fair values presented in this note are based on provisional valuations due to the close proximity of the transaction to the end of the period.

10 Contingent liabilitiesThe Group is not aware of any new major changes with regard to contingent liabilities in comparison with the situation as of 31 July 2010.

11 Current litigationA former Hiestand shareholder has taken legal action against the Company asserting, in essence, entitlement under the merger to a price for its former Hiestand shares equal to the price IAWS Group paid Lion Capital for its former Hiestand shares under their contract. While such an action is permitted under Swiss Law (based on Article 105 of the Swiss Merger Act), it does not affect the implementation of the merger. The Group considers the case to be without merit. A complete defence to the claim, based on the law and the facts, is being vigorously pursued.

12 Subsequent eventsOn 8 March 2011, Origin acquired 100% of United Agri Products Limited (UAP) based on an enterprise value of GBP 33m and the delivery of average working capital. Further consideration of GBP 4m will be paid in March 2013.

29



On 9 March 2011, Origin also acquired 100% of the share capital of Rigby Taylor Limited (Rigby Taylor) for an initial cash consideration of GBP 9.2m. Deferred consideration of up to GBP 1m will be paid upon the achievement of specific profit targets.

The results for both UAP and Rigby Taylor will be consolidated into the Origin results from the date of acquisition to 31 July 2011

13 SeasonalityThe Origin business is typically a seasonal business and is weighted to the second half of the financial year.

14 Related party transactionsThere have been no related party transactions or changes in related party transactions other than those described in the ARYZTA AG 2010 Annual Report and Accounts that could have a material impact on the financial position or performance of the Group in the six months to 31 January 2011.

15 Distribution of interim reportThe Annual Report and Accounts, Interim Management Statements, Interim Report and Accounts and other useful information about the Company, such as the current share price, is available on our website www.aryzta.com.

30


Statement of Directors’ Responsibilitiesfor the six months ended 31 January 2011

We confirm our responsibility for the half year interim results and that to the best of our knowledge:

– The condensed set of financial statements comprising the consolidated interim income statement, the consolidated interim statement of comprehensive income,

the consolidated interim balance sheet, the consolidated interim statement of changes in equity, the consolidated interim cash flow statement and the related notes have been prepared in accordance with IAS 34, Interim Financial Reporting;

– The review of operations includes a fair review of the information required by:

a) Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations 2007, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

b) Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations 2007, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

The Group’s auditor has not audited these half year interim results.

On behalf of the Board

Denis Lucey Owen KillianChairman, Board of Directors CEO, Member of the Board

of Directors

14 March 2011

31


Interim Report and Accounts - Aryzta€¦ · namic pricing, last seen in 2008. Current trends suggest double digit price inflation may be necessary to recover costs. Volatility in

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